Public Service Company of Oklahoma (PSO), a subsidiary of American Electric Power (NYSE: AEP), said today that customer bills in March are significantly lower than just a few months ago, largely because of declining fuel costs.
 
Residential customer bills in March will be lower by 25 percent, or $26, per month than they were in November of last year for customers using 1,000 kilowatt-hours (kWh) of electricity each month.
 
Residential customers who use 1,000 kWh per month will see March bills decline by approximately $11 compared to their electric bills in February, primarily due to PSO’s latest fuel cost reduction, which totals about $260 million. The reduction consists of $206 million in expected lower future natural gas prices and fuel over-recoveries to date, as well as $54 million in a refund ordered by the Federal Energy Regulatory Commission in a case over how PSO parent AEP allocated gains from off-system energy sales among its operating utility companies.
 
“We are pleased that declining natural gas prices have enabled us to substantially lower the bills for our customers, especially in today’s challenging economy,” said Stuart Solomon, PSO president and chief operating officer. “The majority of our fuel costs are based on the price of natural gas. The significant decline in natural gas prices over the past several months has made it possible for us to adjust downward the fuel portion of customers’ bills.  The fuel cost decreases have also been helpful in that they more than offset the increase in PSO’s non-fuel, operational rates that went into effect in February.”
 
PSO adjusts the fuel cost portion of customer bills once per year in June, unless fuel costs change dramatically during the course of the year.  When that happens, an adjustment to fuel factors is made. PSO monitors fuel costs each month to determine whether such an adjustment is appropriate.
 
PSO does not make any profit or a markup on fuel costs; customers only pay the actual costs of fuel.
 
PSO, a unit of American Electric Power (NYSE: AEP), is an electric utility company serving approximately 527,000 customers in eastern and southwestern Oklahoma.  Based in Tulsa, PSO has 4,405 megawatts of generating capacity, and is the largest provider of wind energy in the state.  News releases and other information about PSO can be found on the World Wide Web at PSOklahoma.com.
 
American Electric Power is one of the largest electric utilities in the United States, delivering electricity to more than 5 million customers in 11 states. AEP ranks among the nation’s largest generators of electricity, owning nearly 38,000 megawatts of generating capacity in the U.S. AEP also owns the nation’s largest electricity transmission system, a nearly 39,000-mile network that includes more 765 kilovolt extra-high voltage transmission lines than all other U.S. transmission systems combined. AEP’s transmission system directly or indirectly serves about 10 percent of the electricity demand in the Eastern Interconnection, the interconnected transmission system that covers 38 eastern and central U.S. states and eastern Canada, and approximately 11 percent of the electricity demand in ERCOT, the transmission system that covers much of Texas. AEP’s utility units operate as AEP Ohio, AEP Texas, Appalachian Power (in Virginia and West Virginia), AEP Appalachian Power (in Tennessee), Indiana Michigan Power, Kentucky Power, Public Service Company of Oklahoma, and Southwestern Electric Power Company (in Arkansas, Louisiana and east Texas). AEP’s headquarters are in Columbus, Ohio.